[Federal Register Volume 62, Number 126 (Tuesday, July 1, 1997)]
[Rules and Regulations]
[Pages 35338-35342]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-17104]
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SECURITIES AND EXCHANGE COMMISSION
17 CFR Parts 239, 240, 249 and 269
[Release No. 33-7424; 34-38771; 35-26733; 39-2354; IC-22727]
Amendments to Forms and Schedules to Remove Voluntary Provision
of Social Security Numbers
AGENCY: Securities and Exchange Commission.
ACTION: Final rules.
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SUMMARY: The Securities and Exchange Commission is adopting revisions
to forms and schedules filed under the Securities Act of 1933, the
Securities Exchange Act of 1934, related provisions of the Investment
Company Act of 1940 and the Public Utility Holding Company Act of 1935,
and the Trust Indenture Act of 1939, to eliminate the portion of those
forms that requests filers who are natural persons to furnish their
Social Security numbers.
EFFECTIVE DATE: The rule revisions are effective July 1, 1997.
FOR FURTHER INFORMATION CONTACT: Marija Willen, Regulatory Counsel,
Division of Corporation Finance, (202) 942-1805; Richard C. Strasser,
Special Counsel, Division of Market Regulation, (202) 942-0073, U.S.
Securities and Exchange Commission, Washington, DC 20549.
SUPPLEMENTARY INFORMATION: The U.S. Securities and Exchange Commission
(the ``Commission'') is adopting amendments to the following forms and
schedules under the Securities Act of 1933 (the ``Securities
Act''),1 the Securities Exchange Act of 1934 (the ``Exchange
Act''),2 and the Trust Indenture Act of 1939 (the ``Trust
Indenture Act''): 3 Form 144; 4 Schedule 13D;
5 Schedule 13G; 6 Schedule 14D-1; 7
Form 3; 8 Form 4; 9 Form 5; 10 Form
MSD; 11 Form TA-1; 12 and Form T-2.13
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\1\ 15 U.S.C. 77a et seq.
\2\ 15 U.S.C. 78a et seq.
\3\ 15 U.S.C. 77aaa-77bbb.
\4\ 17 CFR 239.144.
\5\ 17 CFR 240.13d-101.
\6\ 17 CFR 240.13d-102.
\7\ 17 CFR 240.14d-100.
\8\ 17 CFR 249.103.
\9\ 17 CFR 249.104.
\10\ 17 CFR 249.105.
\11\ 17 CFR 249.1100.
\12\ 17 CFR 249b.100.
\13\ 17 CFR 269.2.
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I. Discussion
Commission rules and regulations require the filing and public
disclosure of information by natural persons as well as corporate and
other entities. The Commission is amending forms that request
individual filers to disclose their Social Security numbers. These
forms will no longer include any reference to Social Security numbers,
and as appropriate, the forms will be revised to delete the portion of
the form where filers included this information.
The Commission is taking this action in response to increasing
concern about the improper use of Social Security numbers for access to
otherwise non-public information.14 The forms on which
individuals can disclose their Social Security numbers are available to
the public. In the past, this has not led to significant abuse.
However, with the growth of the EDGAR database and its availability to
millions of viewers on the Commission's web site, the Commission is
concerned that these numbers are too readily available. This is
especially true where impersonal electronic
[[Page 35339]]
commercial transactions made possible by recent developments in
technology encourage potential impostors. The Commission has determined
that the usefulness of Social Security numbers filers voluntarily
provide on these forms is outweighed by the risk of misuse created by
the disclosure of those numbers.
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\14\ Some of the forms being amended also call for disclosure of
the I.R.S. identification number of the filing party--in most cases
on a voluntary basis--if the filing party is an entity rather than
an individual. The forms as amended retain this information. The
disclosure of I.R.S. identification number of entities does not
raise the same concerns as Social Security numbers. In fact, a
number of the Commission's forms require disclosure of the I.R.S.
identification number of the filing party.
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A Social Security number can be the key to obtaining personal and
private information about individuals. In recent years, the use of
Social Security numbers as a universal identifier has increased
significantly. With a Social Security number and certain other
publicly-available information, it is possible to retrieve sensitive
personal and financial information about people from a variety of
sources, both legal and illegal. These sources include the Internet,
which has increased both the amount and type of information available
and the level of concern about the privacy of personal information.
Generally, the forms that the Commission is amending do not require
that filers disclose their Social Security numbers. The forms include
cautionary notes stating that the information is public and explaining
how it may be used. For example, Social Security numbers may be used to
help to identify filers. Because the forms make the inclusion of the
number voluntary, however, some filers include the number and some do
not. As a result, Social Security numbers cannot be used as a
consistent mechanism for tracking the information provided about
individuals in the Commission's forms. The Commission staff, and others
who analyze the information disclosed in the forms, must use other
means to track the individuals for analysis of the information. The
Social Security number is not otherwise necessary for the evaluation of
the information disclosed.
At this time, the Commission will continue to request that filers
voluntarily disclose Social Security numbers on three Exchange Act
forms: Form BD (uniform application for registration as a broker-dealer
or to amend such an application), Form BDW (notice of withdrawal from
registration as a broker-dealer) and Form X-17A-19 (report by national
securities exchanges and registered national securities associations of
changes in the membership status of any of their members). These forms
are used not only by the Commission but also by state regulators and
self-regulatory organizations. Other users of the forms have
independent authority to establish their own forms and have determined
that Social Security numbers are useful for their purposes.
Historically, they have not supported amending the forms to remove the
request for Social Security numbers. Because it is important that these
forms remain uniform, the Commission has decided to continue to request
that filers voluntarily disclose Social Security numbers on these
forms. Currently, these forms are not filed on EDGAR or disseminated
over the Internet. Should the information begin to be published on the
Internet, the issue will need to be reconsidered by the Commission and
by the other users of the forms.
In addition, the Commission is not now amending Forms ADV (uniform
application for registration as an investment adviser or to amend such
application) and ADV-W (notice of withdrawal from registration as an
investment adviser), which are filed by investment advisers under the
Investment Advisers Act of 1940.15 These forms, like those
mentioned in the previous paragraph, are used by state regulators as
well as the Commission. Forms ADV and ADV-W are not available on EDGAR
or on the Internet. The Commission currently is reviewing Forms ADV and
ADV-W and anticipates proposing substantial revisions to the forms. In
connection with the review process, the Commission will consider
eliminating Social Security numbers from the forms. State regulators
have independent authority to establish their own forms, however, and
may determine that Social Security numbers are useful for their
purposes. The Commission, therefore, may decide to continue to request
that filers voluntarily disclose Social Security numbers on Forms ADV
and ADV-W so that the forms remain uniform.
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\15\ 15 U.S.C. 80b-1-80b-21.
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II. Effective Date
These changes are effective on the date of their publication in the
Federal Register. The Commission's Publications Unit is printing new
forms. The current forms will continue to be valid, but filers using
those forms are requested not to include their Social Security numbers.
III. Certain Findings
Since the amendments to the forms and schedules to delete the
voluntary provision of Social Security numbers relate solely to agency
organization, procedure, or practice, publication for notice and
comment is not required under the Administrative Procedure
Act.16 It follows that the requirements of the Regulatory
Flexibility Act do not apply.
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\16\ 5 U.S.C. 553(b).
\17\ 5 U.S.C. 601-612.
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The rules relating to the disclosure of Social Security numbers are
effective upon publication in the Federal Register. The Commission
finds that there is good cause to dispense with the 30-day delay
between publication and effectiveness normally required by the
Administrative Procedure Act.18 There would be no hardship
imposed on the filers of the affected forms, since the amendments
simply would eliminate space on the forms for information that filers
were providing voluntarily for the Commission's use, or on users of the
information since the Social Security number information has been
provided voluntarily. Balancing the possible harm to filers from the
disclosure of their Social Security numbers against any possible
hardship to filers or investors and other end-users, the Commission
finds good cause for making these rules immediately effective.
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\18\ 5 U.S.C. 553(d).
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The amendments to these forms do not come within the scope of the
Paperwork Reduction Act of 1995 19 because the amendments
are not a substantive or material change to a collection of
information.20
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\19\ 44 U.S.C. 3501 et seq.
\20\ 5 CFR 1320.5(g).
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Under 5 U.S.C. 804, this rule is exempt from the definition of the
term ``rule'' for purposes of Chapter 8, entitled ``Congressional
Review of Agency Rulemaking,'' since the rule is a rule of agency
organization, procedure, or practice that does not substantially affect
the rights or obligations of non-agency parties.
Section 23(a)(2) of the Exchange Act 21 requires the
Commission to consider the anti-competitive effects of any rules it
adopts thereunder, and to balance them against the benefits that
further the purposes of the Act. Because the amendments here do not
effect any substantive change, they do not have any anti-competitive
effects.
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\21\ 15 U.S.C. 78w(a)(2).
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IV. Cost-Benefit Analysis
Because these amendments are procedural rules, and will impact the
Commission rather than any filer, a traditional cost-benefit analysis
appears unnecessary. The amendments will benefit individual filers by
eliminating the possibility of the disclosure of confidential
information and there do not appear to be any significant costs to the
public as a result of making these changes.
[[Page 35340]]
Furthermore, section 2 of the Securities Act 22 and
Section 3 of the Exchange Act,23 as amended by the recently
enacted National Securities Markets Improvement Act of
1996,24 provide that whenever the Commission is engaged in
rulemaking and is required to consider or determine whether an action
is necessary or appropriate in the public interest, the Commission also
shall consider, in addition to the protection of investors, whether the
act will promote efficiency, competition, and capital formation.
Because the amendments will help to protect individual filers from the
disclosure of otherwise confidential information, the amendments are in
the public interest and will not affect efficiency, competition or
capital formation.
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\22\ 15 U.S.C. 77b.
\23\ 15 U.S.C. 78c.
\24\ Pub. L. 104-290, secs. 106, 110 Stat. 3416 (1996).
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V. Statutory Basis
The amendments to Form 144 are being adopted by the Commission
pursuant to sections 2(11), 4(1) and 19(a) of the Securities Act. The
amendments to Schedule 13D, Schedule 13G, Schedule 14D-1, Form 3, Form
4 and Form 5 are being adopted by the Commission pursuant to sections
3(a)(11), 3(a)(12), 3(b), 9(b), 10(a), 12(h), 13, 14, 16 and 23 of the
Exchange Act. As Forms 3, 4 and 5 relate to the Investment Company Act
of 1940 25 and the Public Utility Holding Company Act of
1935,26 the changes to those forms are also adopted pursuant
to Investment Company Act sections 30 and 38 and Public Utility Holding
Company Act sections 17 and 20, respectively. The amendments to Form
MSD are being adopted by the Commission pursuant to sections 15,
15B(a), 17(a) and 23(a) of the Exchange Act. The amendments to Form TA-
1 are being adopted by the Commission pursuant to sections 17, 17(A)(c)
and 23(a) of the Exchange Act. The amendments to Form T-2 are being
adopted pursuant to the authority set forth in sections 304, 305, 307,
308, 310, 314 and 319 of the Trust Indenture Act.
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\25\ 15 U.S.C. 80a-1 et seq.
\26\ 15 U.S.C. 79a et seq.
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List of Subjects in 17 CFR Parts 239, 240, 249 and 269
Reporting and recordkeeping, Securities.
Text of the Amendments
In accordance with the foregoing, Title 17, Chapter II of the Code
of Federal Regulations is amended as follows:
PART 239--FORMS PRESCRIBED UNDER THE SECURITIES ACT OF 1933
1. The authority citation for part 239 continues to read, in part,
as follows:
Authority: 15 U.S.C. 77f, 77g, 77h, 77j, 77s, 77z-2, 77sss, 78c,
78l, 78m, 78n, 78o(d), 78u-5, 78w(a), 78ll(d), 79e, 79f, 79g, 79j,
79l, 79m, 79n, 79q, 79t, 80a-8, 80a-29, 80a-30 and 80a-37, unless
otherwise noted.
* * * * *
2. By amending Sec. 239.144, paragraph (c), by revising the second
and last sentences to read as follows:
Sec. 239.144 Form 144, for notice of proposed sale of securities
pursuant to Sec. 230.144 of this chapter.
* * * * *
(c) * * * Disclosure of the information specified in this form is
mandatory before processing notices of proposed sale of securities
under Sec. 230.144 of this chapter. * * * Failure to disclose the
information requested by Form 144 would make an exception under
Sec. 230.144 of this chapter unavailable and may result in civil or
criminal action for violations of the Federal securities laws.
Sec. 239.14 [Form 144 Amended]
3. By amending Form 144 (referenced in Sec. 239.144) by revising
the caption to Item 2(b) and revising Instruction 2(b) to the cover
page to read as follows:
Note: The text of Form 144 does not, and the amendments will
not, appear in the Code of Federal Regulations.
Form 144
Notice of Proposed Sale of Securities
Pursuant to Rule 144 Under the Securities Act of 1933
* * * * *
Item 2(b). I.R.S. Ident. No.
* * * * *
Instructions:
* * *
2. (a) * * *
(b) Such person's I.R.S. identification number, if such person is
an entity
* * * * *
PART 240--GENERAL RULES AND REGULATIONS, SECURITIES EXCHANGE ACT OF
1934
4. The general authority citation for part 240 is revised to read
as follows:
Authority: 15 U.S.C. 77c, 77d, 77g, 77j, 77s, 77z-2, 77eee,
77ggg, 77nnn, 77sss, 77ttt, 78c, 78d, 78f, 78i, 78j, 78k, 78k-1,
78l, 78m, 78n, 78o, 78p, 78q, 78s, 78u-5, 78w, 78x, 78ll(d), 79q,
79t, 80a-20, 80a-23, 80a-29, 80a-37, 80b-3, 80b-4 and 80b-11, unless
otherwise noted.
* * * * *
5. By amending Sec. 240.13d-101 by revising Item (1) on the cover
page and the heading and the last sentence of Instruction (1) for the
cover page, by removing the phrase ``Social Security or'' in the
second, third and fourth undesignated paragraphs under SPECIAL
INSTRUCTIONS FOR COMPLYING WITH SCHEDULE 13D, by revising the words
``regulatory statements'' to read ``regulatory statutes'' in the third
undesignated paragraph under SPECIAL INSTRUCTIONS FOR COMPLYING WITH
SCHEDULE 13D, and in the fourth undesignated paragraph under SPECIAL
INSTRUCTIONS FOR COMPLYING WITH SCHEDULE 13D by correcting the word
``resuly'' to read ``result'', to read as follows:
Sec. 240.13d-101 Schedule 13D--Information to be included in
statements filed pursuant to Sec. 240.13d-1(a) and amendments thereto
filed pursuant to Sec. 240.13d-2(a).
* * * * *
(1) Names of reporting persons.
I.R.S. Identification Nos. of above persons (entities only).
* * * * *
Instructions for Cover Page
(1) Names and I.R.S. Identification Numbers of Reporting
Persons-- * * * Reporting persons that are entities are also
requested to furnish their I.R.S. identification numbers, although
disclosure of such numbers is voluntary, not mandatory (see
``SPECIAL INSTRUCTIONS FOR COMPLYING WITH SCHEDULE 13D'' below).
* * * * *
6. By amending Sec. 240.13d-102 by revising Item (1) on the cover
page and the heading and last sentence to Instruction No. 1 for the
cover page, and adding SPECIAL INSTRUCTIONS FOR COMPLYING WITH SCHEDULE
13G following the third undesignated paragraph under ``NOTES:'' and
before ``Instructions'' to read as follows:
Sec. 240.13d-102 Schedule 13G--Information to be included in
statements filed pursuant to Sec. 240.13d-1 (b) and (c) and amendments
thereto filed pursuant to Sec. 240.13d-2(b).
* * * * *
(1) Names of reporting persons.
I.R.S. Identification Nos. of above persons (entities only).
* * * * *
Instructions for Cover Page
(1) Names and I.R.S. Identification Numbers of Reporting
Persons--* * * Reporting persons that are entities are also
requested to furnish their I.R.S. identification numbers, although
disclosure of such numbers is voluntary, not mandatory (see
``SPECIAL INSTRUCTIONS FOR COMPLYING WITH SCHEDULE 13G'' below).
* * * * *
[[Page 35341]]
SPECIAL INSTRUCTIONS FOR COMPLYING WITH SCHEDULE 13G
Under Sections 13(d), 13(g) and 23 of the Securities Exchange
Act of 1934 and the rules and regulations thereunder, the Commission
is authorized to solicit the information required to be supplied by
this schedule by certain security holders of certain issuers.
Disclosure of the information specified in this schedule is
mandatory, except for I.R.S. identification numbers, disclosure of
which is voluntary. The information will be used for the primary
purpose of determining and disclosing the holdings of certain
beneficial owners of certain equity securities. This statement will
be made a matter of public record. Therefore, any information given
will be available for inspection by any member of the public.
Because of the public nature of the information, the Commission
can use it for a variety of purposes, including referral to other
governmental authorities or securities self-regulatory organizations
for investigatory purposes or in connection with litigation
involving the Federal securities laws or other civil, criminal or
regulatory statutes or provisions. I.R.S. identification numbers, if
furnished, will assist the Commission in identifying security
holders and, therefore, in promptly processing statements of
beneficial ownership of securities.
Failure to disclose the information requested by this schedule,
except for I.R.S. identification numbers, may result in civil or
criminal action against the persons involved for violation of the
Federal securities laws and rules promulgated thereunder.
* * * * *
7. By amending Sec. 240.14d-100 by revising Item (1) on the cover
page and the heading and last sentence to Instruction No. 1 for the
cover page, and in the second, third and fourth undesignated paragraphs
under SPECIAL INSTRUCTIONS FOR COMPLYING WITH SCHEDULE 14D-1 removing
the phrase ``Social Security or'' to read as follows:
Sec. 240.14d-100 Schedule 14D-1. Tender offer statement pursuant to
section 14(d)(1) of the Securities Exchange Act of 1934.
* * * * *
(1) Names of reporting persons.
I.R.S. Identification Nos. of above persons (entities only).
* * * * *
Instructions for Cover Page
(1) Names and I.R.S. Identification Numbers of Reporting
Persons-- * * * Reporting persons that are entities are also
requested to furnish their I.R.S. identification numbers, although
disclosure of such numbers is voluntary, not mandatory (see
``SPECIAL INSTRUCTIONS FOR COMPLYING WITH SCHEDULE 14D-1'' below).
* * * * *
PART 249--FORMS, SECURITIES EXCHANGE ACT OF 1934
PART 249b--FURTHER FORMS, SECURITIES EXCHANGE ACT OF 1934
8. The authority citation for parts 249 and 249b continues to read
in part as follows:
Authority: 15 U.S.C. 78a, et seq., unless otherwise noted;
* * * * *
9. By amending Sec. 249.103 by revising the third sentence to read
as follows:
Sec. 249.103 Form 3, initial statement of beneficial ownership of
securities.
* * * Disclosure of information specified on this Form is
mandatory, except for disclosure of the I.R.S. identification number by
entities, which is voluntary. * * *
Sec. 249.103 [Form 3 amended]
10. By amending Form 3 (referenced in Sec. 249.103) by revising the
first sentence of the second undesignated paragraph of the introductory
statement to the General Instructions and by revising Item 3 to the
information preceding Table 1 to read as follows:
Note: The text of Form 3 does not, and the amendments will not,
appear in the Code of Federal Regulations.
Form 3 Initial Statement of Beneficial Ownership of Securities
* * *
Disclosure of information specified on this form is mandatory,
except for disclosure of the I.R.S. identification number of the
reporting person if such person is an entity, which is voluntary. *
* *
* * * * *
* * *
3. I.R.S. Identification Number of Reporting Person, if an
entity (Voluntary)
* * * * *
11. By amending Sec. 249.104 by revising the third sentence to read
as follows:
Sec. 249.104 Form 4, statement of changes in beneficial ownership of
securities.
* * * Disclosure of information specified on this Form is
mandatory, except for disclosure of the I.R.S. identification number by
entities, which is voluntary. * * *
Sec. 249.104 [Form 4 amended]
12. By amending Form 4 (referenced in Sec. 249.104) by revising the
first sentence of the second undesignated paragraph of the introductory
statement to the General Instructions and by revising Item 3 to the
information preceding Table 1 to read as follows:
Note: The text of Form 4 does not, and the amendments will not,
appear in the Code of Federal Regulations.
Form 4 Statement of Changes of Beneficial Ownership of Securities
* * *
Disclosure of information specified on this form is mandatory,
except for disclosure of the I.R.S. identification number of the
reporting person if such person is an entity, which is voluntary. *
* *
* * * * *
* * *
3. I.R.S. Identification Number of Reporting Person, if an
entity (Voluntary)
* * * * *
13. By amending Sec. 249.105 by revising the third sentence to read
as follows:
Sec. 249.105 Form 5, annual statement of beneficial ownership of
securities.
* * * Disclosure of information specified on this Form is
mandatory, except for disclosure of the I.R.S. identification number by
entities, which is voluntary. * * *
Sec. 249.105 [Form 5 amended]
14. By amending Form 5 (referenced in Sec. 249.105) by revising the
first sentence of the second undesignated paragraph of the introductory
statement to the General Instructions and by revising Item 3 to the
information preceding Table 1 to read as follows:
Note: The text of Form 5 does not, and the amendments will not,
appear in the Code of Federal Regulations.
Form 5 Annual Statement of Beneficial Ownership of Securities
* * *
Disclosure of information specified on this form is mandatory,
except for disclosure of the I.R.S. identification number of the
reporting person if such person is an entity, which is voluntary. *
* *
* * * * *
3. I.R.S. Identification Number of Reporting Person, if an
entity (Voluntary)
* * * * *
Sec. 249.1100 [Form MSD amended]
15. By amending General Instruction M to Form MSD (referenced in
Sec. 249.1100), by removing the words ``, except social security
numbers, disclosure of which is voluntary'' in the second sentence.
Note: The text of Form MSD does not, and the amendments will
not, appear in the Code of Federal Regulations.
Sec. 249b.100 Form TA-1 amended]
16. By amending Form TA-1 (referenced in Sec. 249b.100) to remove
the second column entitled ``Social Security Number'' in Schedules A, B
and C.
Note: The text of Form TA-1 does not, and the amendments will
not, appear in the Code of Federal Regulations.
[[Page 35342]]
PART 269--FORMS PRESCRIBED UNDER THE TRUST INDENTURE ACT OF 1939
17. The authority citation for part 269 continues to read as
follows:
Authority: 15 U.S.C. 77ddd(c), 77eee, 77ggg, 77hhh, 77iii,
77jjj, 77sss, 78ll(d), unless otherwise noted.
18. By amending Sec. 269.2 by revising the third sentence, removing
the eighth sentence and revising the ninth sentence to read as follows:
Sec. 269.2 Form T-2, for statement of eligibility and qualification
for individual trustees.
* * * Disclosure of the information specified in this form is
mandatory before processing statements of eligibility and
qualification. * * * Failure to disclose the information requested by
this form may result in enforcement action by the Commission to compel
compliance with the Federal securities laws.
Sec. 269.2 [Form T-2 amended]
19. By amending Form T-2 (referenced in Sec. 269.2), in SPECIAL
INSTRUCTIONS FOR COMPLETING FORM T-2, removing the phrase ``, except
for social security account numbers, disclosure of which is voluntary''
in the first sentence of the second paragraph, removing the second
sentence of the third paragraph, and removing the phrase ``, except for
social security account numbers'' in the fourth paragraph, and in the
Form by removing the second line, ``(Social Security Number)''.
Note: The text of Form T-2 does not and the amendments will not
appear in the Code of Federal Regulations.
Dated: June 25, 1997.
By the Commission.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 97-17104 Filed 6-30-97; 8:45 am]
BILLING CODE 8010-01-U
